…The overnight (OVN) rate expanded by 10bps w/w to 27.0%, driven by debits for market funded FX purchases from the CBN (c. N220.00 billion)
SAT APRIL 12 2025-theGBJournal| The Treasury bills secondary market traded with bearish sentiments as the average yield expanded by 279bps to 24.9% by close of trade Friday. The bearish sentiments is attributed to FPI-triggered selloffs amid the ongoing trade tensions .
Across the market segments, the average yield advanced by 119bps and 492bps to 21.1% and 29.3% in the NTB and OMO segments, respectively.
At Wednesday’s NTB auction, the CBN offered bills worth N800.00 billion – N50.00 billion for the 91D, N100.00 billion for the 182D, and N650.00 billion for the 364D bills.
Subscription level settled higher at N1.13 trillion (previous auction: N1.43 trillion), indicating a bid-to-offer ratio of 1.4x (previous auction: 2.0x).
The auction closed with the Central Bank of Nigeria (CBN) under-allotting to the tune of N424.58 billion – N111.81 billion for the 91D, N105.79 billion for the 182D, and N206.98 billion for the 364D papers – at respective stop rates of 18.50% (previous: 18.00%), 19.50% (previous: 18.50%) and 19.63% (unchanged).
The FGN bond secondary market were equally bearish as the average yield expanded by 17bps to 18.9% on sustained risk-off sentiments among offshore/onshore investors, driven by concerns over Trump’s tariff policies, and lingering debt sustainability concerns (amid weaker oil prices).
Across the benchmark curve, the average yield increased at the short (+19bps) and mid (+3bps) segments following selloffs of the JAN-2026 (+45bps) and FEB-2031 (+64bps) bonds, respectively, while it closed flat at the long end.
Over the medium term, we expect a moderation in bond yields, influenced by two factors – the anticipated dovish monetary policy stance and sustained improvement in demand and supply fundamentals in Q2-25.
Meanwhile, the overnight (OVN) rate expanded by 10bps w/w to 27.0%, driven by debits for market funded FX purchases from the CBN (c. N220.00 billion).
The average system liquidity weakened (albeit remaining in the positive terrain), settling at a net long position of N425.84 billion (vs a net long position of N1.33 trillion in the previous week).
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